When you are trading it is very
important that you keep a close eye on your profits. Many traders, especially
the inexperienced ones, will see their trades go up several points only to fall
right back down. This is usually due to poor management of funds. Below I am
going to share 10 ways you can manage your online trading profits.
1 - Manage Your Capital
Once you start trading you will notice
the markets move extremely fast. That's why it is so important you manage your
capital. Be very conservative with your pips. Consider banking only 20 pips at
a time. It might sound small but this approach can quickly add up to 200
points. Doing it this way will help you
protect your profits.
2 – Trail Your Stops
I will be honest with you. It takes a
lot of effort to trail your stops. But doing so is a great way to retain
profits. The first thing you should do is establish a profit target. Sticking
with the 20 pips example, once you reach that point you can move your stop to a
breakeven point. This way even if it drops and removes your stop, you won't
lose anything.
3 – Trade Multiple Lots
Each lot should have a separate target.
For instance, if you have two lots you can be conservative with one of those
lots. By conservative I mean put it near your entry point of 20 pips. Anything
between 15 and 20 pips is good. The second lot can be place further from the
entry point. Relocate the stop to a breakeven point as soon as you reach the
first target.
4 – Never Trade On Impulse
Impulsive traders let their emotions
rule them. They trade based on what they feel and not based on the facts. When
you trade on impulse you are basically gambling with your money. You trade
recklessly and will eventually lose not only your profits, but your capital as
well. So be a logical trader.
5 – Use The 2% Stop Loss Rule
Another great way to mange your profits
is to keep your risk at no more than 2%. This is known as the 2% stop loss
rule. This rule is a safeguard and will protect you from losing a huge amount
of money. Using the 2% stop loss rule you will lose only 2% per trade. With
this type of safeguard in place you would have to do a lot of very poor trading
to lose all your money.
6 – Understand Analysis & Timing
To be successful in trading you have to
understand both analysis and timing. Sometimes you will have to take a modest
loss to protect the bulk of your profits. Trust your eyes and be willing to
make the necessary moves to manage your profits.
7 – Plan Your Entry & Exit Strategy In Advance
You need to know when you will get in
and you need to know when you will get out. This is known as your entry and
exit strategy and it should be done in advance. Having a clear stopping point
is a great way to manage your profits. The key is to stick with the strategy
you have created.
8 – Predetermine Your Risk
Before you enter a trade, take the time
to predetermine your risk. Trading is extremely challenging. You can easily
lose a ton of money in a matter of seconds. That's why it is so important that
you predetermine your risk before you enter a trade.
9 – Focus on Trends
The great thing about trends is that
they can last for months at a time. Focusing on trends can help you increase
your profits with minimal effort.
10 – Know When to Get Out Of a Trade
You need to know when its time to get
out of a trade. If you are clear on something, don't trade it. Follow this rule
and you will be able to manage your profits much better.
Stop Losing money!! Stay on the right
side of the market always with SENTIMENT TRADER - http://sentiment-trader.blogspot.com
No comments:
Post a Comment